Several experts from various European banks agreed that even a proof of concept for a digital euro is four to five years away.
In a panel on Monday entitled “Appreciating Money in the Digital Age: Introduction of the Digital Euro” The participants agreed that the current task was primarily to get everyone to participate in the details of a digital euro and to make an actual implementation in the future.
Central bank digital currencies (CBDCs) have been a hugely popular topic in recent years, but especially since the beginning of the COVID-19 pandemic.
Austėja Šostakaitė of the European Central Bank said the ECB would not make a decision on whether to seriously introduce a digital euro until mid-2021, contradicting an estimate made by the ECB president earlier this month. For now, said Šostakaitė, the question was: “How do we introduce the euro into the ecosystem and how does it help with money from commercial banks?”
An advisor to the Swedish Riksbank, Carl Andreas Claussen, said the central bank completed a proof-of-concept for its e-krona in February, but still estimated that a real start would be “in four or five years”. Claussen said:
“There are some legal issues and this is such an important issue that we cannot decide about it. We need political support. We propose to Parliament that they should have a committee of experts to look into this. “
Sweden is part of the European Union, but not the euro area, which means it will keep its own currency. Internally, Cash usage in Sweden is among the lowest in the world, which means the country has made a leap in digitizing the currency. Interestingly, Claussen also alluded to cross-border application ambitions, very few of which appear in the krona due to the relative usefulness of the euro or the dollar.
With regard to the euro itself, Šostakaitė suggested that external competition could speed up the existing development timetable. “If we see foreign CBDCs or maybe Facebook going into the euro zone, it can speed things up,” he said.
Facebook’s Libra appears to be on its way to launching as a dollar-pegged stablecoin in January.